02574cam a22002777 4500001000700000003000500007005001700012008004100029100002100070245013100091260006600222490004200288500002000330520135500350530006101705538007201766538003601838690005401874690013201928700002202060700002002082710004202102830007702144856003802221856003702259w16322NBER20180319224321.0180319s2010 mau||||fs|||| 000 0 eng d1 aKrishna, Pravin.10aTrade, Poverty and the Lagging Regions of South Asiah[electronic resource] /cPravin Krishna, Devashish Mitra, Asha Sundaram. aCambridge, Mass.bNational Bureau of Economic Researchc2010.1 aNBER working paper seriesvno. w16322 aSeptember 2010.3 aThis chapter studies the differential effects that trade openness may have on leading and lagging regions within a country. Examining data from India, we find that while trade liberalization is associated with reduced poverty, this effect is smaller in lagging states. The expected transmission of international prices to domestic prices with openness to trade is seen to be less perfect in lagging states than in leading ones, especially in the rural sector. This suggests that poverty reduction in lagging regions is impeded by the lack of exposure to international markets as opposed to another commonly argued factor - the competition to domestic production from international trade. Cross-country analysis with a sample of countries in South Asia (Bangladesh, India, Nepal, Pakistan and Sri Lanka) also suggests that countries with a smaller proportion of their populations in lagging regions experience greater reduction in poverty rates following trade liberalization. Our study confirms that though trade liberalization can bring gains, there is scope for policy to ensure that these gains are distributed more equally across sub-national regions. Our results highlight the importance of developing infrastructure including equipped ports, better and more extensive roads and communication links in exploiting gains from international trade. aHardcopy version available to institutional subscribers. aSystem requirements: Adobe [Acrobat] Reader required for PDF files. aMode of access: World Wide Web. 7aF1 - Trade2Journal of Economic Literature class. 7aR11 - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes2Journal of Economic Literature class.1 aMitra, Devashish.1 aSundaram, Asha.2 aNational Bureau of Economic Research. 0aWorking Paper Series (National Bureau of Economic Research)vno. w16322.4 uhttp://www.nber.org/papers/w1632241uhttp://dx.doi.org/10.3386/w16322